Environmental, Social, and Governance (ESG) reporting is no longer optional – it’s becoming a global standard. With rising investor scrutiny, regulatory momentum, and the UAE’s ambitious sustainability goals, listed companies must prioritize transparent and credible ESG disclosures.
In June 2025, the Abu Dhabi Securities Exchange (ADX) released its latest ESG Disclosure Guidance for Listed Companies. This guide helps businesses strengthen their ESG performance reporting, align with international standards, and attract sustainable investments.
At Prabix, we help businesses navigate these evolving frameworks so they remain compliant, credible, and competitive.
Why ESG Disclosure is Essential
- Investor Demand: Global investors now evaluate ESG performance alongside financial results. Topics like climate action, health and safety, corruption, and human rights are central to investment decisions.
- UAE Momentum: With initiatives like UAE Net Zero 2050 and Vision 2031, sustainable finance is accelerating. ESG reporting is becoming as important as financial reporting.
- Strategic Imperative: Regulators, customers, employees, and investors all expect ethical governance and sustainability commitments. Companies that ignore ESG risk losing capital and credibility.
ADX’s Role in Promoting ESG
- ADX encourages listed companies to disclose ESG performance, aligning with international frameworks like IFRS S1/S2 and GRI Standards.
- It has built partnerships with MSCI, FTSE, and global exchanges, ensuring UAE-listed companies are visible to global investors.
- By fostering green finance (like green bonds and sukuks), ADX is positioning the UAE as a hub for sustainable investment.
ESG Explained: The Three Pillars
- Environmental (E): Energy use, GHG emissions, climate risks, water and waste management.
- Social (S): Employee welfare, diversity, human rights, community investment, workplace safety.
- Governance (G): Ethical business practices, board diversity, anti-corruption, data privacy, executive accountability.
Benefits of ESG Disclosure
- Regulatory Readiness – Stay ahead of UAE’s evolving ESG reporting mandates.
- Risk Management – Identify and manage climate, social, and governance risks early.
- Access to Capital – ESG transparency attracts global investors and improves financing terms.
- Enhanced ESG Ratings – Stronger scores boost reputation and investor trust.
- Alignment with UAE Vision 2031 & Net Zero 2050 – Support national sustainability goals while building resilience.
How to Report ESG Effectively
The ADX guide recommends:
- Choose a Framework: IFRS S1/S2 or GRI.
- Engage Stakeholders: Identify material ESG issues relevant to your business.
- Collect & Verify Data: Ensure accuracy and comparability.
- Be Balanced: Report both achievements and challenges.
- Optional Assurance: Third-party validation builds credibility.
Companies can report ESG either as part of annual reports, in standalone sustainability reports, or through integrated reports.
Key ESG Metrics to Watch
Examples from ADX guidance include:
- Environmental: Energy mix, carbon emissions, water usage, climate targets.
- Social: Gender diversity, health & safety, human rights, nationalization.
- Governance: Board independence, ethics policies, anti-corruption, data privacy.
The UAE Advantage
The UAE is moving fast:
- UAE Vision 2031 and Abu Dhabi Economic Vision 2030 integrate sustainability with growth.
- Net Zero 2050 commits the country to climate neutrality.
- Regulators like SCA and ADGM are mandating ESG disclosures, while sovereign wealth funds (like ADIA) demand climate-risk reporting from portfolio companies.
This makes ESG disclosure not just a compliance exercise—but a competitive advantage for UAE-listed firms.
Final Thoughts
The ADX ESG Disclosure Guidance is more than a checklist—it’s a roadmap for listed companies to align with global best practices, strengthen stakeholder trust, and unlock sustainable growth opportunities.
At Prabix, we guide businesses through ESG reporting, corporate tax compliance, and financial advisory services—helping companies stay ahead in an era where transparency, sustainability, and governance define success.
About Prabix
Prabix is your trusted partner for corporate tax return filing, financial compliance, and ESG advisory in the UAE. From navigating the EmaraTax portal to preparing sustainability disclosures, we ensure your business meets regulatory requirements and wins investor confidence.